Simple Interest Calculator
Calculate simple interest on a loan or investment. Unlike compound interest, simple interest is calculated only on the original principal, making it straightforward to compute.
Formula reviewed for accuracy. Our methodology & sources
Simple Interest Calculator
finance calculator
How It Works
Simple interest is charged only on the original principal, never on interest that has already accrued. The calculator multiplies your principal by the annual rate and the number of years, so the interest is the same every period. This makes it predictable and easy to verify — but it grows your money far slower than compound interest over long periods.
Formula
Simple Interest = Principal × Rate × Time I = P × r × t
Examples
$10,000 at 5% for 3 years
$1,500 interest, $11,500 total.
Frequently Asked Questions
What is simple interest?
Simple interest is calculated only on the original principal, not on accumulated interest. It is common for short-term loans, car loans, and some bonds.
How is simple interest different from compound interest?
Simple interest is calculated only on the principal. Compound interest is calculated on the principal plus accumulated interest, so it grows faster over time.
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